What the pet food recall didn't accomplish, the economy did

There have been a couple of interesting reports about pet food sales recently.  In spite of the recall, pet food dollar sales went up in 2007 and 2008, according to IRI data cited in a Packaged Facts report titled “Pet Food in the U.S.”  The increase wasn’t from volume, but from increased sales of premium products, due both to concern driven by the recall, and by the long term trend of consumers seeking products they perceive as healthier.  Pound sales were down 2% and unit sales down 6%. 

And there were more products to choose from.  According to Packaged Facts, 270 new products were introduced in 2008, 51% more than in 2007.  Among the products driving growth are those offering nutraceutical benefits or claiming natural/organic/locally grown/whole and real food ingredients.  What’s next?  PF speculates that a major marketer will get into the raw food segment, especially one that has expertise in managing refrigerated or frozen products, like, say, Del Monte or Nestle Purina.

Dog food in the down economy?

Dog food in the down economy?

 Meanwhile, a story in the February 13th issue of The Wall Street Journal reported that the Department of Commerce (even without a Secretary!) released figures showing that 4Q08 had the biggest drop in consumer food spending since the Department began tracking the data 62 years ago.  Analysts speculate that consumers are buying less prepared food, fewer restaurant meals, more generics and basic foods rather than fancy items, and clearing out their pantries before shopping for more.  Sales of generics are up significantly versus sales of branded products.  Between Q3 and Q4 2008, sales of pet food dropped 5.1%, according the Commerce’s figures, which are based on sampling receipts of food-oriented businesses.

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